As the North American session begins, the AUD is the strongest and the CHF is the weakest. The USD is mixed with gains vs the GBP, JPY and CHF and declines vs the EUR, CAD, AUD and NZD.
Overnight, New Zealand employment change for the first quarter came in at -0.2% versus +0.3% expected. The unemployment rate rose to 4.3% from 4.0% in the fourth quarter. The NZD is mixed to start the US session.
Today is Fed Day. The Federal Reserve will announce their rate decision at 2 PM ET with the Fed expected to keep rates unchanged. Fed Chair will address the press starting at 2:30 PM ET>
The question the markets will want to know is how hawkish are the Fed members? We know that the Chair Powell - and other fed officials - have already shifted to "unchanged for longer". Will they hint at a more symmetrical stance whereby they keep the door open for a cut or a hike.
The expectation now is a 50-50 chance of a cut in September after stronger-than-expected Employment Cost Index released yesterday. Admittedly the Consumer confidence data was also much worse than expectations yesterday balancing some of the most recent data.
Highlighting the anxiety and uncertainty, Citibank analysts predict that the S&P 500 will experience its most significant movement on a Federal Open Market Committee (FOMC) day since May 2023, with an expected fluctuation of 0.95%. This forecast is based on an options strategy known as an at-the-money straddle, which involves purchasing an equal number of call and put options at the same strike price and expiration.
The ADP employment data will be released at 8:15 AM ET for April with expectations of 175K vs 184K last month. On Friday the US jobs report will be released with expectations of 250K non-farm payroll jobs. The unemployment rate is expected to remain unchanged at 3.8% while earnings are expected to rise by 0.3%.
ISM manufacturing data will be released at 10 AM ET with expectations of 50.0 versus 50.3 last month. Prices paid are expected to dip to 55.0 from 55.8 last month. The JOLTS job openings for March will also be released with 8.6886M expected versus 8.756M last month.
It is also a new month and is May Day in Europe.As a result, most of the European stock markets are closed today.
In earnings after the close yesterday, Amazon beat expectations. It's shares are modestly higher. SMCI shares are lower as they missed on Revenues, blaming supply chain issues for some key components. The market is not listening to excuses as shares are down over -12%. Starbucks shares are also lower after missing on EPS and revenues.
Stryker Corp (SYK) Q1 2024 (USD): shares are trading down -0.45%
- Adj. EPS: 2.50 (Beat, exp. 2.35)
- Revenue: 5.2bn (Beat, exp. 5.1bn)
- Summary: BEAT
Advanced Micro Devices Inc (AMD) Q1 2024 (USD): AMD shares are trading-6.49%
- Adj. EPS: 0.62 (Beat, exp. 0.61)
- Revenue: 5.47bn (Beat, exp. 5.46bn)
- Summary: BEAT
Mondelez International Inc (MDLZ) Q1 2024 (USD): shares are trading down -2.70%
- Adj. EPS: 0.95 (Beat, exp. 0.89)
- Revenue: 9.29bn (Beat, exp. 9.16bn)
- Summary: BEAT
Pinterest Inc (PINS) Q1 2024 (USD): PINS shares are trading up 16.05%
- Adj. EPS: 0.20 (Beat, exp. 0.13)
- Revenue: 740mln (Beat, exp. 700.3mln)
- Summary: BEAT
Starbucks Corp (SBUX) Q2 2024 (USD): SBUX shares are trading down -12.71%
- Adj. EPS: 0.68 (Missed, exp. 0.79)
- Revenue: 8.56bn (Missed, exp. 9.13bn)
- Summary: MISSED
Super Micro Computer(SMCI) Q3 2024 (USD): SMCI shares are trading down -12.50%
- Adj. EPS: 6.65 (Beat, exp. 5.78)
- Revenue: 3.85bn (Missed, exp. 3.95bn)
- Summary: MIXED
Amazon.com Inc (AMZN) Q1 2024 (USD): Amazon shares are trading up 1.71%.
- EPS: 0.98 (Beat, exp. 0.83)
- Revenue: 143.3bn (Beat, exp. 142.5bn)
- Summary: BEAT
Below is a summary of some of the major releases this morning. CVS shares are tumbling lower after missing on the top and bottom lines. Yum! Brands also missed and are being punished by traders today:
Automatic Data Processing Inc (ADP): Shares are trading up 1.26%
- EPS: 2.88 (Beat, exp. 2.79)
- Revenue: $5.3 billion (Beat, exp. $5.22 billion)
- Summary: BEAT
Marriott International Inc (MAR): Shares are trading down -1.37%.
- Adj. EPS: 2.13 (Missed, exp. 2.17)
- Revenue: $5.98 billion (Beat, exp. $5.93 billion)
- Summary: MIXED
Yum! Brands Inc (YUM): Shares are trading down -4.96%.
- EPS: 1.15 (Missed, exp. 1.20)
- Revenue: $1.6 billion (Missed, exp. $1.71 billion)
- Summary: MISSED
Kraft Heinz Co (KHC): Shares are trading down -4.61%
- Adj. EPS: 0.69 (Met, exp. 0.69)
- Revenue: $6.4 billion (Missed, exp. $6.43 billion)
- Summary: MIXED
Pfizer Inc (PFE): Shares are trading up 1.29%
- Adj. EPS: 0.82 (Beat, exp. 0.52)
- Revenue: $14.879 billion (Beat, exp. $14.01 billion)
- Summary: BEAT
CVS Health Corp (CVS): Shares are trading down -11.55%.
- Adj. EPS: 1.31 (Missed, exp. 1.69)
- Revenue: $88.4 billion (Missed, exp. $89.21 billion)
- Summary: MISSED
A snapshot of the other markets as the North American session begins currently shows.:
- Crude oil is trading down -$1.30 at $80.57. At this time yesterday, the price was at $83.11
- Gold is trading up $8.16 or 0.35% at $2293.46. At this time yesterday, the price was higher at $2310.90
- Silver is trading up $0.17 or 0.66% at $26.45.. At this time yesterday, the price was at $26.52
- Bitcoin currently trades lower at $57,704. The high-priced today reached $60,786 while the low price was at $56,500. At this time yesterday, the price was trading at $60,966
In the premarket, the US major indices are trading lower after closing April with sharp declines that snapped 5-months of gains for the major indices:
- Dow Industrial Average futures are implying a decline of -69 point. Yesterday, the index closed the market with a sharp decline of -570.17 points or -1.49% at 37815.93. For the month the index fell -5.0%..
- S&P futures are implying a decline of -16.94 points. Yesterday, the index fell -80.46 points or -1.57% at 5035.70. For the month the index fell -4.16%.
- Nasdaq futures are implying a decline of -72 points. Yesterday, the index fell minus 328.26. points or -2.04% at 18687.82. For the month, the index fell -4.41%.
Apart from the UK FTSE 100, other European markets are closed for the May Day holiday:
- German DAX, closed. Yesterday the index fell -1.03%. For the month the index fell -3.03%
- France CAC , closed. Yesterday the index fell -0.99%. For the month the index fell -2.69%
- UK FTSE 100, -0.04%. For the month the index gained 2.41%.
- Spain's Ibex, closed. Yesterday the index fell -2.22%. For the month the index fell -1.99%
- Italy's FTSE MIB, closed (delayed 10 minutes). Yesterday the index-1.60%. For the monthly XL -2.89%
Shares in the Asian Pacific markets were mostly higher
- Japan's Nikkei 225, -0.34%
- China's Shanghai Composite Index, closed for the day
- Hong Kong's Hang Seng index, closed for the day
- Australia S&P/ASX index, -1.23%
Looking at the US debt market, yields are modestly lower after rising yesterday on the back of the stronger-than-expected employment cost index data:
- 2-year yield 5.029%, -1.7 basis points. At this time yesterday, the yield was at 4.974%
- 5-year yield 4.710%, -1.3 basis points at this time yesterday, the yield was at 4.651%
- 10-year yield 4.677%, -0.6 basis with. At this time yesterday, the yield was at 4.61%
- 30-year yield 4.779%, -0.9 basis points. At this time yesterday, the yield was at 4.738%
Looking at the treasury yield curve spreads moved more inverted:
- The 2-10 year spread is at -35.1 basis points. At this time yesterday, the spread was at -35.3 basis points
- The 2-30 year spread is at -25.0 basis points. At this time yesterday, the spread was at -23.3 basis points
European benchmark 10-year yields are higher:
